Can BCI be covered under the ambit of an ‘enterprise’ under Section2(h) of Competition Act?

The coram comprising of Ashok Kumar Gupta (chairperson) and Sangeeta Verma and Bhagwant Singh Bishnoi (Members), considered whether Bar Council of India is an ‘enterprise’ under Section 2(h) of the Competition Act. Informant filed the present information under Section 19(1)(a) of the Competition Act 2002 alleging contravention of the provisions of Section 4 of the Act by Bar Council of India. Informant worked as an executive engineer and planned to voluntarily retire to pursue legal education. He submitted that he appeared for LLB (3 years) entrance examination in the state of Andhra Pradesh and secured 1^st rank in the examination. Informant stated that BCI enjoys the dominant position in controlling legal education as well as legal practice in India.

The BCI is an elected body of advocates in India. It regulates the legal practice as well as legal education in India. It enjoys the dominant position in controlling the legal practice in India. Based on the above, the Informant has prayed before the Commission to declare the impugned Clause 28 as illegal and void ab initio and impose maximum penalty on the BCI for the violation of Section 4 of the Act and indulging in colorable exercise of power. Thus, the primary question which falls consideration is that whether BCI is an ‘enterprise’ within the meaning of Section 2(h) of the act. The term ‘enterprise’ has been defined under Section 2(h) of the act, inter alia, as a person or a department of the government, engaged in any activity relating to provision of any kind of services.

1. In the present matter, the commission notes that BCI is a statutory body established under Section 4 of the Advocates Act 1961. Section 7 of the said Act lays down the functions of the BCI which includes promotion of legal education in India and to lay down standards of such education in consultation with the universities in India and the state bar council.
2. Further, section 49 of the advocates act 1961, empowers the BCI to make rules for discharging its functions under the said act such as prescribing qualifications and disqualifications for membership of a bar council, minimum qualifications required for admission to a course of degree in law in any recognized universities, prescribing the standards of legal education for the universities in India.
3. Thus, it is noted that the BCI appears to carry out functions which are regulatory in nature in respect of the legal profession.

Judgment relied on by the court

In the Dilip Modwil and Insurance Regulatory and Development Authority (IRDA), decided on 12-09-2014,

“Commission had observed that any entity can qualify within the definition of the term ‘enterprise’ if it is engaged in any activity which is relatable to the economic and commercial activities specified therein. It was further observed that regulatory functions discharged by a body are not per se amenable to the jurisdiction of the Commission.”

When the BCI appears to be discharging its regulatory functions, it cannot be said to be an ‘enterprise’ within the meaning of Section2(h) of the Act and consequently, the allegations made in relation to discharge of such functions which appears to be non-economic in nature, may not merit an examination within the provisions of the Section 4 of the Act. The commission is of the opinion that there is no prima facie case under the provisions of Section 4 of the Act and the information files is directed to be closed forthwith against the opposite party under Section 26(2) of the Act. No case for grant for relief(s) as sought under Section 33 of the act arises and the same is also rejected.